Paris (AFP)

The spread of the coronavirus will brutally curb the world economy whose growth should not exceed 2.4% this year at best, warned the OECD on Monday, while the G7 and the Eurogroup are mobilizing.

The international organization has warned that the world could even experience a recession in the first quarter.

In November, the OECD still estimated the increase in global gross domestic product (GDP) at 2.9% this year, a level that was already the lowest since the 2008-2009 financial crisis.

The OECD, the first major international institution to publish a forecast of the economic impact of the epidemic, specifies that its main scenario is that of a health crisis reaching its peak in China during the first quarter of 2020 and for which households in d other countries remain contained.

A more sustainable epidemic, which would spread widely in Asia-Pacific, Europe and North America, on the other hand would halve global growth this year, which could then fall to 1.4%, warns the organization. In this case, we would see a contraction of around 3.75% in world trade.

To avoid this catastrophic scenario, the G7 finance ministers will meet - by phone - this week "to coordinate their responses," said French Minister Bruno Le Maire. The president of the Eurogroup, the Portuguese Mario Centeno announced for his part on his Twitter account, a meeting Wednesday of the finance ministers of the euro zone, also by phone.

- Chinese growth below 5% -

After the steepest drop in Western stock indexes in 12 years in the past week, markets expect central banks to step up to the plate, as the chairman of the Federal Reserve said he was ready if necessary.

The governor of the Bank of France François Villeroy de Galhau recommends for his part not to "overreact", judging the monetary policy "already very accommodating".

The Bank for International Settlements (BIS) - the central bank of central banks - believes the financial system is stronger than in 2008, but warns that hopes for a rapid recovery are now "grossly unrealistic".

Because China, the engine of the world economy, will see its growth reduced to 4.9% this year, if the epidemic reaches its peak before the end of March. And it will carry in its wake all the major economies, warns the OECD.

For the eurozone, growth will plateau at 0.8% and 0.9% for France, while it will be nil in Italy, the main focus of Covid-19 in Europe. German gross domestic product (GDP) will only increase by 0.3%.

Japan also suffered severely from the health crisis with growth reduced to 0.2%, while the United States resisted better with 1.9%.

"The contraction in production in China has had effects all over the world, testifying to the growing importance of China in global supply chains and in raw materials markets," says the international organization based in Paris. .

- an already fragile global economy -

China now hosts more than 20% of world industry, against less than 8% in 2002, a year before the SARS epidemic, while its share in world GDP has increased from 6% to more than 16 %.

In the most favorable scenario of the OECD, global growth should then rebound in 2021, to 3.3%. However, it warns that this implies implementing its recommendations for targeted support to businesses and households.

The coronavirus strikes at a time when global growth is already being weakened by the trade war between the United States and China. Despite the agreement reached in January by the two largest economies in the world, "customs duties between the two countries remain significantly higher than two years ago," notes the OECD.

The organization has also significantly revised down India's growth, from 6.2% to 5.1% for 2020, and from 6.4% to 5.6% for 2021, due in particular to a too much corporate debt weighing on investment.

Finally, GDP growth in the UK is expected to peak at 0.8% in 2020 and 2021 even if there is a free trade agreement with the EU, as "non-tariff barriers are likely to weigh on exports and growth of production throughout 2021 ".

© 2020 AFP